Dubai’s VARA Grants In-Principle Approval for First Permissionless Asset-Backed Token

Dubai’s Virtual Assets Regulatory Authority (VARA) has granted in-principle approval to Atlas AI Labs for the issuance of USAF+, an asset-backed token designed to operate in a permissionless blockchain environment.

W3C supported Atlas AI Labs throughout the regulatory process.

The approval positions USAF+ as what the company describes as the first asset-backed token structured for issuance in a fully permissionless environment under VARA’s regulatory framework.

Tokenized ETF Backed by Traditional Market Assets

USAF+ represents a digital expression of the Atlas America Fund (NASDAQ: USAF), an SEC-registered ETF custodied by Bank of New York Mellon.

The token’s net asset value (NAV) is directly referenced to the underlying NAV of the ETF, ensuring parity between the digital token and traditional fund valuation.

According to the company’s disclosure, the ETF’s underlying portfolio includes U.S. Treasuries, TIPS, municipal bonds, gold, real estate exposure through REITs, as well as allocations across defense, cybersecurity equities, and select commodities.

Regulatory Structure Under VARA’s ARVA Framework

The approval was issued under Dubai’s Asset-Referenced Virtual Asset (ARVA) Rulebook, which governs tokenized instruments backed by real-world assets.

The in-principle approval allows Atlas AI Labs to move toward issuance of a tokenized financial product that combines regulated asset backing with blockchain-based transferability in a permissionless environment, subject to final licensing approval.

Open Architecture and Market Design

The USAF+ structure is designed to enable continuous access to a traditionally regulated financial instrument.

The token is intended to be accessible, transferable, and settleable 24/7 without reliance on traditional market gatekeepers, while maintaining institutional custody and regulatory oversight at the underlying asset level.

The company also states that reserve backing and disclosure will follow the same reporting schedule as the underlying ETF and will be independently attested by a third-party verifier.

Institutional Positioning and Investment Framework

The Atlas America Fund, which underpins USAF+, is actively managed under what the company describes as a regime-aware investment framework.

This framework dynamically adjusts portfolio allocation based on macroeconomic conditions, supported by Atlas AI Labs’ research infrastructure and oversight from the Atlas Capital Team Inc. investment committee.

Regulatory and Market Significance

The approval adds to Dubai’s growing positioning as a regulated hub for tokenized real-world assets under frameworks such as VARA’s ARVA regime.

If fully licensed, USAF+ would represent one of the earliest examples of a tokenized SEC-registered ETF issued within a permissionless blockchain environment while remaining tied to regulated custody and reporting standards.

Next Steps Toward Full Licensing

With in-principle approval secured, Atlas AI Labs will now pursue full licensing from VARA to enable issuance and operational deployment of USAF+.

The final authorization will determine the operational scope of the product, including issuance mechanics, trading conditions, settlement processes, and compliance requirements within secondary markets.

Broader Implications for Tokenized Finance

The approval adds to a broader industry trend in which regulated financial instruments are increasingly being explored for on-chain issuance and settlement.

What differentiates USAF+ is the combination of regulated ETF backing, institutional custody infrastructure, and a permissionless issuance model under a formal virtual asset regulatory framework. The structure reflects growing experimentation around how traditional capital market products can operate within blockchain-native environments while remaining connected to regulated financial systems.

Dubai’s approval of Atlas AI Labs’ USAF+ initiative reflects the continued convergence of traditional finance and blockchain infrastructure, as regulated investment products increasingly move toward tokenized and continuously accessible market models.